After years of fending off takeover attempts, Biocancell Therapeutics Ltd. (TASE:BICL) chairman and CSO Prof. Avraham Hochberg seems to have concluded that a takeover is actually the best alternative for the drug development company. Biocancell has asked its largest shareholder, Clal Biotechnology Industries Ltd. (TASE: CBI), to assume de facto control of the company at no additional investment.
It is quite possible that Clal Biotech, which owns 14.52% of Biocancell, may later decide to invest an additional $5-10 million in the company, either alone or with one of its usual partners. Meanwhile, Clal Biotech CEO Reuven Krupik will replace Hochberg as chairman of Biocancell, and will appoint CFO Ofer Goldberg as a director.
Following the announcement of the appointments, Biocancell's share price rose 7.4% to NIS 2.73, giving a market cap of NIS 72 million. Biocancell's other main shareholders are Hochberg, with 8.1%, and Tikcro Technologies Ltd. (Bulletin Board: TKCRF) owns 3%, but owns convertible bonds, which could turn it into a major shareholder.
Clal Biotech's takeover comes after years of tension between it and Biocancell, especially after Clal Biotech did not receive a majority of directors following its joint investment with Tikcro in Biocancell in 2008. The dispute led Biocancell CEO Avi Barak to leave the company in 2009. Clal Biotech then opened negotiations to invest in the company, but called them off when Barak returned as vice chairman. The struggle between the companies continued through 2009 and 2010.
In early 2010, there was talk that Clal Biotech shareholder Teva Pharmaceutical Industries Ltd. (Nasdaq: TEVA; TASE: TEVA) would make a strategic investment in Biocancell, but nothing came of it, reportedly because Biocancell refused Teva's terms.
Published by Globes [online], Israel business news - www.globes-online.com - on March 8, 2011
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